Sonic Drive-In
Case BackgroundIn 1953, Tyro Smith founded the prototype of the first Sonic drive-In in Shawnee, Oklahoma. Before 1953, he had already tried opening two other restaurants. Smith eventually bought a steak house that had a root beer stand on the lot. He intended to tear the stand down to add more parking for the steak house, but the root beer stand, called Top Hat Drive-In, proved to be more profitable and even outlasted the steak house. While traveling in Louisiana, Smith saw homemade intercom speakers at a hamburger stand that let customer order right from their cars. He liked the idea so much that he contacted the innovator and asked him to install the same intercom for Top Hat. The speaker system was placed, a canopy was added for cars to park under, and “carhops” delivered food directly to the customers’ car.

Charlie Pappe, a manager of a local supermarket but looking for a new venture, dined at Top Hat while visiting his friends in Shawnee and was si impressed with the whole concept that he introduced himself to Smith. In 1956, Pappe successfully opened the second Top Hat Drive-In. Four Top Hats had been opened by 1958, when Smith and Pappe discovered that the Top Hat name was copyrighted and began searching for a new name. Top Hat’s slogan had been “Service with the Speed of Sound,” so they agreed on Sonic, which means moving at the “speed of sound.” The first Sonic Drive-In was in Stillwater, Oklahoma, and still serves hot dogs, root beer, and frozen favorites on the same site today.

Smith and Pappe helped the new partners with the layout, site selection, and operation of their new Sonic Drive-In. they charged a royalty fee of one penny per sandwich bag used by the franchisee. Pappe died in 1967, and Smith was left alone to run the company along with two franchisee who had been invited to run the supply and distribution division of Sonic. In the early days, there was no national advertising and there were no territorial rights. In 1973, a group of ten principal franchise owners, who became the officers and board of directors, restructured the company into Sonic Industries. These groups of directors purchased the sonic name, slogan, trademark, logos, and supply company and offered shares of stock to each store operator. Sonic was now owned by its franchisees and was a publicly traded company. At this point, there were 165 Sonics in the chain. From1973 to 1978, Sonic experienced a period of temendous growth. During this time, 800 new stores were opened. Sonic Advertising Trust was introduced during this period, which established a Sonic School to formally train new managers and launched Sonic’s first advertising campaign.

In 1995, Sonic introduced “Sonic 2000”, an aggressive “multi-layered strategyto further unify the company in terms of a consistent menu, brand identity, products, packaging and service”. A key element of Sonic 2000 was a “new, retrofitted exterior that features futuristic red pylons with fiber-optic lights, oval roofs and new logo”. Between 1996 and 1997, the percentage of customers who recognized the Sonic brand increased from 43 to 66. In 2001, Hudson took Sonic International by opening a store in Monterrey, Mexico, with more restaurants planned in Mexico City. By 2002, 2432 Sonic Drive-Ins operated in more than 30 states and two countries. Sonic grown to be a strong regional competitor, but as Sonic executives pondered additional growth, understanding the nature of the competitive environment became increasingly important. Environmental Analysis

Sonic is located primarily in the Sun Belt state and know for its personal carshop service and unique made to order menu item including toaster sandwiches, extra long cheese, coneys, frozen and fountain favorites. SONIC esp. menu allowed the chain to differ itself from other fast food outlets and to avoid price wars with its major competitions. Hamburger are serve in aluminum foil to preserve the heat, drink are put styro rather...

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...Executive Summary
Sonic is the largest drive-in chain in the United States. Under the slogan "America's Drive-In," a Sonic features fast service by roller-skating carhops and unique menu items that cannot be found at McDonalds, Burger King, or Wendys. Sonic restaurants operate in 27 states so it is smaller than leading fast food chains however it is still a significant competitor. Founded by Troy Smith and Charlie Pappe in 1953, Sonic went from a single root beer stand to a popular franchise. In 1973, Sonic restructured as a franchise company and later became Sonic Corporation. The company experienced financial decline due to the lack of consistency from its franchisees so they were bought out by Sonic Corporation and restructured. In 1995, Sonic introduced "Sonic 2000," an aggressive multi-layered strategy to further unify the company in terms of a consistent menu, brand identity, products, packaging, and service. The campaign was successful and Sonic's brand recognition increased. Strengths include a strong competitive nature, flexible strategies, and employee/franchisor relationships. Weaknesses include lack of communication and domestic expansion. Threats in the external environment include company size, employee turnover, weak economy, rivals in similar industries, overseas expansion, and slow growth markets....

...Sonic SWOT Analysis
Mgt/521
October 11, 2011
Willie, Zebedee
The use of an SWOT analysis helps obtain information to understand the position of a company. The company chosen is Sonics Corp. This analysis will help determined whether to invest in this company. This discussion will include the company’s strengths, weaknesses, opportunities, threats, and trends. The information that follows should allow me to determine if this is a good company to invest in or not. Next I will determine the company’s internal and external stakeholders, I will determine if the stakeholder’s needs are met and what will need to happen if the needs of the stakeholders are not met.
Strengths
Established in 1953, Sonic Corp has become a successful corporation across the United States. The company offers quick services with the use of micro-phoned carhop servers on roller skates. The company offers customizable menus that allow the company to differentiate itself from competitors. Sonics is known for its strong human resources and management which governs the company policies. These key factors are an attribute to the success of the company. Strength of the company is its fun cultures. The company has a trendy look that attracts customers. Customers have loved the ability to use the drive-in services or the option to dine-in on the patio. The company inventory uses Styrofoam cups, and aluminum...

...Executive Summary
SONIC America’s Drive-In is a fast food joint where customers drive into a car slot and order from a menu at the driver's side. Orders are placed through an intercom system, and then you can swipe your plastic card near the intercom to pay. The novelty is that servers roller skate out to your car for a true drive-in experience. There are two options either you can take your order to go, or stay and eat in the car. “SONIC has over 3,500 locations in more than 40 states, serving around 3 million customers per day. SONIC offers a food selection of hamburgers, chili cheese hot dogs, onion rings and tater tots, along with breakfast burritos, wrap sandwiches, and frozen desserts” (www.sonicdrivein.com).
Success in any business is both analyzing the past experiences and searching for future opportunities and SONIC is no exception in this matter. To win more customers they will need to come up with some innovative ideas. Obviously, their specialty service, the drive-in experience cannot be enjoyed without a vehicle. Establishment of new indoor dine-in areas could serve the potential walk- in customer’s needs. Also it is increasingly difficult to fight the cold weather for the roller skating servers in some part of the United States, but more importantly it is a interfering factor for SONIC in their further expansion. In addition, fast...

...you think Sonic would have grown as large as it did today if it had remained a sole proprietorship? Why or why not?
* What were the advantages and disadvantages to sonic of each form of business ownership?
* There have been lots of drive-in and fast food restaurants over time. In your opinion, what makes Sonic and other major franchises more successful than others?
I personally do not think that Sonic wouldn’t have grown as large as they are now if they would have remained a proprietorship. When Troy Smith first started the company back in 1954 is stayed the same for 2 years. In 1956 when Troy Smith brought a partner into the business it began to grow. The company stayed the same for 2 years. I do not think that the company would have grown unless Troy Smith brought a partner a partner into the business, based on the information that is given.
Some disadvantages to owning a business is that when your first getting started you stay away from home and have very long hours. That means less time with your family and more time at the office. Most business owners usually haft to learn how to balance business and hone life. This also leads to many advantages. Some of the advantages is that is you manage everything right and do everything accordingly; you can have the opportunity to have many franchises and become more successful. Sonic now has over 3,000 drive-in...

...Sonic’s Growth
First, let us take a look at some business terms. A sole proprietorship is a business that is owned and operated by one person. A partnership is a legal form of business with two or more owners. A corporation is a legal entity with authority to act and have liability apart from its owners. A franchisor is a company that develops a product concept and sells others the rights to make and sell the products. (Nickels)
A man named Troy Smith began the sonicdrive-in restaurant in 1954, as a sole proprietorship. Two years later, he took on a partner, and watched the business grow. As partners, they shared profits and liabilities. After the death of Smith’s partner, he found many people wanted to franchise the business. The Sonicdrive-in restaurant began to grow even quicker. A man named Cody Barnett took over his father’s seven franchises. He added fifteen more to those. Understanding the different types of business is vital in getting it started and adjusting to the growth of the business. (Nickels)
The Sonic Company would not have been able to grow as large as it is now if it had remained a sole proprietorship. As it grew, it would have been too much for one person to manage. The liability would have been too great for one person to handle. With sole proprietorship, the personal assets of the sole proprietor can be used to pay off business debt. The sole proprietor is held personally...

...Sonic: America’s Drive-In - Case Analysis
Table of Contents
i. General Background / Key Issues
ii. Analysis
a. Internal Analysis
b. External Analysis
c. Business-level Strategy
d. Corporate-level Strategy
e. Structure and Controls
f. Strategic leadership/ Entrepreneurship
iii. Case Recommendations
iv. Referenced
i. General Background / Key Issues
Sonic was created over 50 years ago, the enterprise started as a small drive in Shawnee, Oklahoma. The company started out as “Top Hat Drive-In” but was changed to “Sonic” because the old name was copyrighted and the slogan their “Service With the Speed of Sound.” Business flourished from 1973 to 1978 with the opening of 800 new stores. However, with the opening of all these stores caused taste variation between each of the stores, even in the same city. This was because each franchise bought ingredients from different vendors. All this caused management to buyout all the franchisees in 1986 for 10 million dollars. The debt from this acquisition was repaid by 1995 after 2 stock offerings. So after all this drama in the company, things got a lot better for Sonic thereafter. They started “Sonic 2000” which made their stores more visually appealing. Sonic also added a new menu items and standardized the menu for all stores in the chain,...

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